Thursday, August 31, 2006

How much information can a landlord share?

I recently found this website,, which is a site where "tenants can share horror stories about lousy landlords they've had". Viewers email in their horror stories, which are then printed (including the Landlord's name) on the front page. This is in hopes that would-be tenants can use the site as a resource to avoid renting from "bad landlords".

According to the court officer in my town, the tenants that I just threw out have been evicted two or three times already, usually leaving the apartment heavily damaged. I know (from a different tenant) that they signed a new lease elsewhere a few days before moving out of my unit. I don't know where that landlord is, but surely they'd like to know what I've just been through. Ideally, they would have had a similar website to look through before signing their lease.

In actuality, there are ways to look up if a potential tenant has been evicted, since evictions are part of the public record. But what about bad tenants that aren't evicted but cause problems while living there or leave the place a disaster when they leave? These types of problems wouldn't be recorded anywhere, though they should be shared.

My questions to you are:

  1. Is this legal?

  2. Can landlords do the same?

  3. If so, is there something like this already?

Oh, and if you're a landlord and your name is on the site, I'd love to hear from you.

Crazy tenants

Now that my troubled tenants are out and I know the place isn't too damaged, I can post this without being as wary! Reuters is carrying a bizarre story about an evicted tenant that blows up his landlord's flat:

LISBON (Reuters) - An 80-year-old man blew up his flat on Monday to retaliate for being evicted by his landlord, bringing down part of his five-floor central Lisbon block and setting it alight.

"He had threatened neighbours that he would blow up the place if he ever got kicked out," Carlos Pinto, a fireman with the Lisbon fire brigade, told Reuters. "I guess he kept his promise."

He said neighbours had reported that the man had threatened to pour petrol on his floor and set it alight, and one reported seeing him with a bottle of petrol moments before the explosion.

The man suffered severe burns. No other casualties were reported.

At least my recent situation didn't get this out of hand.

New paint, new floors.

The place is now getting painted and the floors redone. I'm bartering with my tenants (the ones who cleaned the newly opened unit), in exchange for their work I am going to give them discounts on their winter rent. For me, this is better than discounts on current rents, because I'm already not collecting rent in the unit that is getting fixed. For them, this is better because they typically work outside, so the winter months are when they are most stretched.

They are very hard workers and charge very reasonable rates. Hopefully it will be finished within a week or two.

Friday, August 25, 2006

It's getting cleaned

I was able to schedule a garbage cleanup, where a truck gets sent specifically to pick up the stuff at my building. I then contacted different tenants of mine who are always looking for some work. They looked over the trashed apartment, and offered to move all of the garbage out to the curb and clean the apartment for a reasonable price. I accepted.

Now, they're just about finished. I am going to meet them up there tomorrow to discuss the other work that needs to be done before I can rent the apartment out. Currently, it looks like the place will need to be painted, windows will need to be repaired (which I will be doing through a different person), and the floors need to be fixed.

I am not going to be able to rent the place out by September 1st, unfortunately, but hopefully sometime before October 1st.

Tuesday, August 15, 2006


Well, today at noon I met the Court Officer at my property to finally evict my tenants. When I arrived, he had already placed a note on the door reading:

NOTICE By order of: The ****** County Special Civil Part, Tenants of these premises have been evicted and the plaintiff placed in full possession thereof. NO TRESPASSING.

He knocked on the door several times, there was no response and no sign of the dogs. I unlocked the door and we went upstairs...

The place was a mess. The first thing that I noticed was that they pulled up the rugs in the hall and the master bedroom, the rugs that I had paid them to put in about 10 months ago (at a good price including time and materials, and when I inspected soon after installation looked good).

They left most of the large furniture including queen size mattresses, several dressers, and cabinets. Besides that, they left an old television, an old microwave, piles of books, a huge bag of garbage, and tons of other items scattered all over the place. According to the neighbor, they moved yesterday by carrying the things that they wanted out in pillow cases.

Other than the junk, there were a few problems, but thankfully nothing permanent. Problems like three broken windows, lights, and door knobs.

Obviously, this is going to be an ordeal to fix, but I'm happy they're out. First I need to talk to my lawyer to figure out 1) Do I have to store the remaining stuff, or can I assume that they do not want it? 2) Should we pursue any criminal charges? 3) How should we approach small claims?

I am definitely going to take them to court to get a judgment, then work to get reimbursed.

As far as the apartment, one of my other tenants has a business that does jobs like cleaning apartments after tenants move out, painting, and sanding/staining floors (There are hard wood floors underneath the carpets, which I'm thinking about just fixing and leaving. What are the advantages to hard wood vs. carpets in rentals?)

The next few weeks will still be interesting, but at least I know where things stand and I don't have to worry about being liable for those vicious dogs. Unfortunately, I do not think that the apartment will be ready for September 1st, but hopefully by the 15th.

The line of the day goes to my friend's girlfriend, when she came up with today's theme song:

Who kicked the dogs out?

Rick, Rick, Rick Rick.

Saturday, August 12, 2006

Important queston to ask yourself before purchasing an investment property in a new town

There is an important question that you must know the answer to before purchasing an investment property in a new town:

How are you going to inform potential tenants that you have a place available for rent?

This is one thing that I was extremely lucky with when purchasing my first real estate investments. There is a popular weekly circulation which _everybody_ in the town religiously reads, and in fact is the only place I need to advertise when renting an empty apartment..

The circulation is distributed every Thursday night to quickmarts, grocery stores, donut shops, and others within a 20-30 mile range. It contains items for sale, service advertising, and most importantly rental advertisements. It has become the definitive source of pricing rentals, and is where everybody looks.

Before purchasing an investment property in a new town, I would highly recommend looking into how potential tenants find available apartments. There are towns where there is not a good source, and it will be more difficult for you to determine the fair market value, or even rent your apartments. I'm not saying that you shouldn't buy in these places, but if you do you should deduct a higher vacancy/maintenance percentage when calculating your monthly cashflow.

Another advantage is that I can easily follow the rental market. I try (try being the operative word) to input the rental prices into a database every week. I input the # of bedrooms and rental price. I can then track the price fluctuations of the units over time (broken up by number of bedrooms). I know that this isn't completely accurate, but it allows me to get an idea of how the fair market value fluctuates over time. This is particularly helpful when pricing a empty unit right before I advertise. Also, I can easily find renters (although I apparently don't always screen them enough). Once I put an advertisement in the circulation (about $10 for two weeks) I instantly get 10+ calls from potential tenants.

These circulations are most important when purchasing investment properties in smaller towns. If you're renting out an apartment in a city, there are other good ways to go (craigslist for example). In smaller towns not everybody uses the internet. You could go with a realtor, but that ends up costing a lot. Really, your best bet is to understand what the locals use.

Friday, August 11, 2006


The judge denied my tenant's Order to Show Cause.

Unlike last time, we had a courtroom all to ourselves. As of 9:15, the tenant did no show up. The judge was already seated, my lawyer was already on the speaker phone, and I was seated at the plaintiff's bench. As the judge was researching whether or not the tenants were served, my tenant and her child walked in (18 minutes late).

The judge invited her to her bench and swore us both in. His first question was directed to the tenant, asking her why the court should grant her request. Her points were, mainly:

  • She does not have a job, and her boyfriend (who is also on the lease, but has not showed up for either court session) was "out of work for a month".
  • They had to pay off other fees, including tickets and "a warrant to keep him out of jail"
  • The remainder of their money went towards the security deposit of their new apartment, which they will start renting Sept. 1st. Until then, they have nowhere to live.
  • She "is receiving $30k" in a settlement in about 2 weeks. The money will be directly deposited into her account.

When she was finished, the lawyer asked her for the name of her lawyer who was handling the settlement. She couldn't name one. He then asked her for the name of the lawyer that was representing the other side, she couldn't name one.

Then, my lawyer asked if he could respond to her points. He said:

  • My client has been more than patient with the tenants. He sent them notice regarding the dogs before I became involved, after which I sent them formal notice.

  • Her dogs are vicious and dangerous. The neighbors are scared, and if left in the unit could very well hurt somebody.
  • My client's water bill has been four times the normal cost since they moved in. I'm afraid that they've maliciously left it on since moving in.
  • They have been completely incommunicado, unresponsive to my client's inquiries until "judgment day" is imminent, at which point they suddenly are interested
  • I ask the court not to interfere with my client's legal rights, when he's been toocompassionate and they've made no effort to remedy the situation.

At this point, the judge made his decision. His points were:

  • If they were really getting the settlement, there are many places they could go with the judgment to get an advance (if they could prove that they're going to get the money). Why haven't they made an effort?
  • These dogs are dangerous, and they've made no effort to temporarily move them somewhere else.
  • The water situation is troubling. Are the tenants just running the water? At this point the tenant interjected that this was the first time she had heard about the water. In fact, I had told her boyfriend multiple times about it. There is no evidence of leaks, he simply said "the faucet drips", even though it has been replaced.

There was a back and forth about how she had nowhere to go. The judge asked her if she had family in the area, she nodded. Then he announced that he was denying her request. She quickly got up and left, with her daughter. The lawyer hung up, and the judge excused us.

Obviously, I was pleased with the verdict. I can not imagine that it would have ended any other way. They've made absolutely no attempt to pay their rent, or to keep me up to date on their situation. This has been a learning experience, and now I know several things to look out for. First and foremost, I am going to run criminal and credit checks before signing the lease next time.

Now, I just have to wait until Tuesday at noon, at which point I will inspect the apartment. My lawyer recommended bringing a digital camera and video camera, in case there are problems we can use that later (pressing criminal and/or civil charges).

More wait.

Thursday, August 10, 2006

Unexpected turn of events: Court hearing (apparently) at 9am tomorrow

Well, things took an unexpected turn today.

So the Warrant of Removal was served, and I've set up an appointment with the court officer to take back the property next week.

Then today, at around 3:30pm, I received a call from my lawyer's secretary. It turns out that my tenants filed an Order to Show Cause today, which means that there is an emergency court hearing scheduled for tomorrow where my tenants will have the opportunity to convince the judge to halt the eviction process, thus allowing them to stay for (at least?) the rest of the month. Remember, they now owe me three months rent, over $500 in attorney fees, and over $200 in late fees (actually, according to our contract they owe me $10 a day after the 6th of the month, but on the forms that have been filed $200 was listed).

The first problem, is that I personally have to appear in court, I cannot be represented solely by my attorney. Secondly, they only schedule landlord tenant matters on Fridays, so if I want to get them out next week, I have to show up tomorrow. This is regardless of whether or not I have an important meeting that I _need_ to be at tomorrow at 3pm. This is also regardless of whether my attorney is booked all morning and cannot show up until at least 1:30pm.

So, I'm going to go by myself at 9am, and then teleconference my attorney in so that he can hear/participate while he's doing the other stuff that he needs to do (the court apparently has the facilities for this).

On the form the tenants filled out, they crossed out the section about the tenant paying what they owe. They say that they do not have the money, but potentially will come up with it (They've mentioned an unrelated settlement, but they've said that several months ago and I no longer buy it).

The thing I don't understand is how they haven't cared about getting booted out _since June_, and now the court is even considering stepping in to slow it down? Now we just have to wait and see.

An Order to Show Cause, according to Nolo's legal definition

An order from a judge that directs a party to come to court and convince the judge why she shouldn't grant an action proposed by the other side or by the judge on her own (sua sponte). For example, in a divorce, at the request of one parent a judge might issue an order directing the other parent to appear in court on a particular date and time to show cause why the first parent should not be given sole physical custody of the children. Although it would seem that the person receiving an order to show cause is at a procedural disadvantage--she, after all, is the one who is told to come up with a convincing reason why the judge shouldn't order something--both sides normally have an equal chance to convince the judge to rule in their favor.

I'll keep you up to date...

Friday, August 04, 2006

Warrant of Removal has been filed.

The Warrant of Removal was filed yesterday, so now the waiting game continues. The timeline is still silly. After the paperwork is filed, it takes 2-3 days for it to be transfered to the Court Officer. He then serves it, after which the tenants have three days to leave. After that, if they have not left, I'll go with the Court Officer to lock them out.

Hopefully this will be finished by some time next week.